Cascading in a circular economy refers to the process of extracting additional value from materials by using them in a series of successive applications. This involves repurposing materials multiple times before their final disposal, thus extending their utility and minimizing waste. Biological materials can degrade naturally or through managed processes, where they are progressively broken down and utilized by microorganisms for their intrinsic value before being returned to the environment as nutrients . This process optimizes the life cycle of materials, ensuring their maximum contribution to the economy .

Renewable energy is essential to a circular economy because it reduces dependency on finite fossil fuels, which aligns with the circular principles of minimizing waste and optimizing resources. The sustainable use of renewable energy supports the reduction of carbon emissions and environmental impact, thus promoting long-term ecological balance. It also underpins systemic changes where energy-efficient processes are designed to operate on cleaner energy, maintaining economic activities within ecological limits. As circular systems are inherently designed for lower energy consumption, leveraging renewable energy sources further enhances their sustainability and resource efficiency .

A linear economy follows the 'take, make, dispose' model, relying heavily on the assumption of unlimited resources, energy, and credit. This model leads to waste and environmental degradation as resources are used once and discarded . In contrast, the circular economy is based on 'reduce, reuse, recycle,' aimed at keeping resources in use for as long as possible by recovering and regenerating products and materials at the end of each service life. This model is reparative and regenerative by design, conserving natural capital and optimizing resource yields . The circular economy involves managing resources through biological and technical cycles to maintain their value, minimizing waste and promoting sustainability .

A circular economy enhances systemic resilience through diversity, adaptability, and efficient resource use, contrasted with the often rigid and wasteful practices of a linear economy. By employing modular and versatile design principles, it reduces resource dependency and vulnerability to market and environmental shocks. Systems with diverse, flexible approaches are more robust against external disruptions, whereas a linear economy's focus on efficiency can lead to fragility. Furthermore, by promoting renewable energy use and minimizing waste, a circular economy contributes to environmental resilience and sustainability, capable of adapting to and mitigating impacts from climate change and resource scarcity .

Designing products according to the principles of the circular economy involves several challenges. Products must be created to facilitate easy disassembly and re-adaptation, allowing materials to be reused or recycled efficiently. Designers need to balance functionality with the use of sustainable and non-toxic materials, ensuring they fit into biological or technical cycles. This requires innovative thinking to incorporate modularity and flexibility to enhance product lifespan and adaptability to changing requirements. Additionally, integrating such design principles requires rethinking supply chains and business models, often needing significant shifts from current practices to align with circular economy objectives .

In a circular economy, finite resources are managed by maintaining and recovering value through cycles, such as reusing and refurbishing products, which contrasts with the linear economy's single-use model. Renewable resources are optimized through sustainable practices, using processes and technologies that support resource regeneration and maintain ecological balance, thereby reducing depletion. The circular model emphasizes selective and efficient resource utilization, guided by smart technology choices, and promotes the use of renewable energy to sustain these processes . This systemic approach aims to replace the linear consumption model with a more efficient cycle that preserves natural capital .

Ken Webster identifies that the principles of a circular economy, namely preserving and enhancing natural capital, optimizing resource yields, and fostering system effectiveness, contribute significantly to environmental sustainability. By controlling finite stocks and balancing renewable resource flows, circular principles aim to reduce dependency on non-renewable resources. The use of renewable energy and increased material longevity reduce environmental impact, while focusing on the efficacy of consumption helps decrease waste and pollution . These actions help address various environmental challenges, such as soil regeneration and reducing toxic emissions, thereby promoting a sustainable interaction with natural ecosystems .

The circular economy addresses externalities neglected by the linear economy by promoting systemic solutions that incorporate environmental and social costs into economic decisions. It reduces negative externalities such as waste generation, pollution, and resource depletion through efficient resource use and recovery processes. Additionally, the circular model emphasizes intervening in product design and system management to prevent adverse impacts on health, land use, and biodiversity. By incorporating life cycle assessments and sustainable practices, it reveals and mitigates hidden environmental costs, promoting a holistic approach that includes both economic and ecological well-being .

Legislation plays a crucial role in facilitating the transition from a linear to a circular economy. Current discussions emphasize the need for legal frameworks that incentivize companies to adopt circular business models. This includes creating policies that encourage manufacturers to design products with longer life cycles, promote recycling in industrial processes, and stimulate economic incentives for companies to collect and refurbish used products. The European Commission has actively engaged in such efforts, as illustrated by the 'Manifesto for a Resource-Efficient Europe,' advocating for regulatory measures that support the circular economy principles and push for an economic shift that integrates environmental sustainability .

The circular economy decouples growth from resource consumption primarily through resource optimization, process efficiency, and waste minimization. It leverages closed-loop systems, where materials and products are continuously circulated back into the economy, thus minimizing the need for new resource extraction. By focusing on product longevity, repairability, and recyclability, it reduces material throughput. Innovation in product-as-a-service models shifts the focus from product ownership to accessibility, reducing the need for ownership-driven consumption. Furthermore, using renewable energy to power these systems ensures that growth is not tied to increased fossil fuel consumption, promoting sustainable development .